United States

House of Representatives passes the Regulatory Accountability Act of 2017

Legislators seek to end judicial deference to agency regulations


On Jan. 11, 2017, in a 238-183 vote, the House of Representatives passed H.R. 5, the Regulatory Accountability Act of 2017. Title II of that bill, the Separation of Powers Restoration Act (SPRA), modifies the Administrative Procedure Act and specifically charges the Judiciary with “decid[ing] de novo all relevant questions of law, including the interpretation of constitutional and statutory provisions, and rules made by agencies.” This de novo review would apply in ‘any action for judicial review of agency action authorized under any provision of law.’                           

This de novo review requirement seeks to statutorily reverse the Supreme Court’s 1984 ruling in Chevron, U.S.A. Inc. v. Natural Resources Defense Council Inc., 467 U.S. 837, and end what has become known as ‘Chevron-style deference.’ In Chevron, the Supreme Court held that when a statute is silent on the precise question at issue, the judiciary should defer to the interpretations and rules promulgated by the regulatory agencies unless those promulgations are arbitrary, capricious, or manifestly contrary to the statute:

“If Congress has explicitly left a gap for the agency to fill, there is an express delegation of authority to the agency to elucidate a specific provision of the statute by regulation. Such legislative regulations are given controlling weight unless they are arbitrary, capricious, or manifestly contrary to the statute. Sometimes the legislative delegation to an agency on a particular question is implicit rather than explicit. In such a case, a court may not substitute its own construction of a statutory provision for a reasonable interpretation made by the administrator of an agency.”

Chevron, 467 U.S. at 844 (internal citations omitted).

The intent of the SPRA is to clarify the nature of judicial review of agency interpretations and to allow judicial review of agency’s action authorized under any provision of law. H.R. 5, 115th Cong. (2017). Opponents to the SPRA, on the other hand, believe that such deference prevents a generalist Judiciary from overriding the judgment of agency experts. While the discussions surrounding the bill generally focus around economic, health or safety agencies, should this bill pass in the Senate and President-elect Trump sign the bill into law, taxpayers will also have a far better opportunity for success when challenging those regulations promulgated by the Treasury than they have had for the past several decades.

When considering H.R. 5’s effect on Treasury Regulations, however, it should be noted that Chevron is not the only Supreme Court case that will be affected by the modifications H.R. 5 proposes. In 2011, the Supreme Court decided the case of Mayo Foundation for Medical Education and Research, et al. v. U.S., 131 S. Ct. 704, affording Chevron-style deference to interpretive regulations and effectively ending any distinction between the two regulation types for purposes of determining their respective authoritative weights. It remains unclear, however, in light of a legislative overturn of Chevron deference, whether or not the courts would rekindle some level of distinction between legislative and interpretive regulations.


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